W.Va. Taxpayers Subsidizing Out-of-State Horse Breeding

April 28, 2013

WHEELING - State taxpayers shelled out $92 million last year to fund horse and dog racing in West Virginia, a review by the Sunday News-Register has revealed.

About $66 million went to those breeding and racing horses - with a large number of the horse breeders living out of state. A total of $9 million went into the Thoroughbred Breeder Development Fund with an additional $56.9 million going to enhance purse funds for horse racing.

For the dogs, greyhound breeders collected about $6 million, with $20 million more going to enhance purse funds, documents obtained through a Freedom of Information request indicate.

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Horse breeders from many states other than West Virginia collected millions from the state’s Thoroughbred Breeder Development Fund during 2012, according to the West Virginia Racing Commission.

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Money for greyhound and thoroughbred racing is drawn from tax proceeds on the slot machines and table games at all four of the state's racetracks. Greyhound breeders are required to live in West Virginia. No such requirement exists for those breeding horses. That has led to horse breeders from 27 states and the District of Columbia taking part in West Virginia's program.

"The Thoroughbred Development Fund allows for out-of-state participation, while the Greyhound Development Fund only permits West Virginia residents to participate," said Jon Amores, executive director of the West Virginia Racing Commission, which oversees the distribution of funds for horse and dog racing in the state.

According to information obtained through the Freedom of Information request, the following were the largest recipients of thoroughbred fund money by state during 2012:

Fact Box

W.Va.'s $92 million investment in horse and dog racing in 2012:

Amount paid to horse

breeders: $9 million

Amount paid to enhance

purses for horse racing: $56.9 million

Amount paid to greyhound breeders: $6 million

Amount paid to enhance

purses for greyhound racing: $20 million

West Virginia - Susan Schramm: $103,466;

Kentucky - Don Cain: $95,881;

South Carolina - Nancy Terhune: $95,081;

Virginia - Maurice Casey III: $84,811;

Maryland - Deborah Butts: $51,095;

North Carolina - E. Clinton Lowry: $50,323;

Pennsylvania - Jeffrey Craig: $34,422;

Arizona - Lew Webster: $29,986;

Texas - Brandford Dawkins Jr.: $24,362;

Florida - Nancy Brown: $20,411;

Georgia - Garvis Williamson: $15,775;

New Jersey - James Holley: $13,634;

Ohio - Mark Haffelt: $12,698;

Montana - Harold Fullerton: $12,257;

Michigan - Harry Waite: $11,572;

Tennessee - Patricia Cunningham: $6,001;

Massachusetts - John P. Casey: $5,742;

California - James McFeeters: $5,584;

New York - Alex Kazdan: $4,807;

Arkansas - Chester Storthz: $4,685;

Delaware - Norma Rodney: $1,798;

Connecticut - Harold Armstrong: $1,410;

Indiana - Roxanne Hyden: $778;

Louisiana - Amanda Krogstad: $710;

Wisconsin - John Taylor: $565;

Alabama - Frederick Griffin Sr.: $107;

Illinois - Kelly Ackerman: $38;

Washington, D.C. - John Meeks: $12,460.

Delegate Randy Swartzmiller, D-Hancock, said limiting participation in the thoroughbred fund to only Mountain State breeders would encourage other states to do the same thing with their own funds.

"I wish it could all go to West Virginia horses and could all stay in West Virginia, but that is not how the industry works," he said. "That would be like saying that West Virginia horses couldn't go to race in other states, and that horses from other states couldn't run here."

State Senate President Jeff Kessler, D-Marshall, said allowing this much money to go to breeders living in other states is "something we need to take a look at."

"The funds are designed to encourage breeding and racing in West Virginia," he said, noting it is possible that some horse breeders could be employing West Virginia residents to care for the horses.

Sen. Rocky Fitzsimmons, D-Ohio, reflected Kessler's comments in noting it is possible some of the horse are being raised in West Virginia, even if their owners live in other states. He stressed he wants as much of the money to stay in the Mountain State as possible.

All three lawmakers said they are looking forward to the results of a comprehensive study of the state's gambling industry, including the aspects of just who is getting money from the funds.

"We need to get everyone to the table to see what is really going on with our casinos and racetracks," Swartzmiller said. "When a lot of this stuff was developed, we didn't have any competition around us. Now, with Pennsylvania and Ohio, plus some other states looking to start up, we may need to make some changes."

Kessler said the thoroughbred and greyhound funds have been helpful for the racing industry, but said he is looking forward to the study's "cost-benefit analysis."

"There seems to be no rhyme nor reason as to how some of these things are going," he said. "We need a system that will be more equitable and fair."

Jim Simms, former president and general manager of Wheeling Island Hotel-Casino-Racetrack, touched on the fairness issue when he noted that Wheeling Island paid out $13.3 million from greyhound races in 2012.

"Only about $3 million of this went to people in West Virginia. A lot of this money went to people in Pennsylvania, Ohio, Florida, Texas and Kansas," Simms said.

Currently, the Wheeling Island casino and the Mardi Gras West Virginia Casino & Hotel near Charleston offer greyhound racing, while Mountaineer Casino Racetrack and Resort in Chester and the Hollywood Casino at Charles Town Races in West Virginia's Eastern Panhandle showcase thoroughbred horses.

As Simms mentioned, the purse funds for greyhounds can go to out-of-state breeders, but the breeders' fund money must stay in West Virginia. Of the money distributed from the greyhound breeders fund in 2012, those who collected at least $200,000 include: